Bitcoin Trade Dashboard

Choosing a Strategy

Now, when it comes to the strategy out there, there is literally a plethora of indicators and methods to pick from. Most traders generally will end up taking many factors into consideration when they attempt to buy or sell cryptocurrency. If you are extremely new to the world of investing, you can even read up on some guides, watch an online course, or gain mentorship from someone who’s a lot more experienced than you.

Generally speaking, the most you will end up learning are from your own successes and failures, but going in prepared is always a plus. If you are experienced, you might already have a strategy in place through which you can genuinely analyze and trade stocks.

Stock trading strategies are also used for cryptocurrencies, and you will feel right at home if you are coming from that kind of background, although you have to be aware that cryptocurrencies as a whole are quite a bit more volatile which keeps things interesting, to say the least.

Storing Cryptocurrency

Storing Your Cryptocurrency

Now comes the important part, storing your cryptocurrency. There are two types of traders out there, traders who trade for the long term, as in buy a cryptocurrency and keep it for a long period of time, and traders who buy, sell and trade on a consistent basis in order to get quick returns of their investments.

If you are trading at regular intervals, you will need to keep at least a portion of your funds on the exchange itself so you can use them regularly and gain almost instantaneous access to them. But if you are on the other end of the spectrum, you can store them in a cryptocurrency wallet.

Now, cryptocurrency wallets are wallets where you can store the private key that you use to access your cryptocurrency. Keep in mind that the cryptocurrency never leaves the blockchain, so you are not literally transferring it to the wallet, but you are transferring the keys that allow you to access that specific address.

Now, there are software wallets and hardware wallets. Software wallets, which also include web wallets, are known as hot wallets due to the fact that they can have access to the internet. Hardware wallets are known as cold wallets due to the fact that they do not have access to the internet and as such, cannot be compromised quite as easily.

How to Choose the Perfect Trading Platform

Choosing the perfect cryptocurrency platform for your specific style of trading is extremely important due to the fact that there are many differences against some of the biggest competing exchanges. Make sure that you do a lot of research before you decide which one ends up being the best for your specific needs.

Currency Availability

Now, when it comes to the currency, you want as many options available to you as possible. Ideally, you want to be able to purchase cryptocurrencies with as many fiat currency options as possible. The most common will typically end up being USD to Bitcoin, or Bitcoin to USD, and so on. However, as the platforms evolve, more and more currencies and conversions will be added, so make sure you read up on this before you decide to create an account.

Leverage

When it comes to leverage, this implies the amount that you are able to trade above your initial deposit and how much you can multiply your games as a whole. Higher leverage will suit risk-takers that are always looking for the highest reward, however, this is not recommended for beginners. One of the most common types of leverages is the 20:1 with cryptocurrencies.

Hedging

This is the risk reduction tactic that involves taking an offsetting position on the primary asset you pick and provides you with insurance as well as reduces the possibility for loss.

Minimum Investment Requirements

This refers to the amount you can deposit and invest with, and this is extremely important as different platforms will typically require different minimum investments from your end, so you should always make sure that you are picking the one that makes the most financial sense in your case.

Level of Customer Support

Now, things rarely go wrong at online cryptocurrency exchanges, but when they do, you will want to know that someone has your back and can answer your queries. Ensure that you pick a platform that truly can offer you some of the best customer support levels.

Liquidity

When it comes to liquidity, you want to find a platform that offers instant liquidity, as the longer you wait for your buy order to complete, the higher the risk as the value might drop. This is due to the fact that the cryptocurrency market is extremely volatile.